Anyone has experience with audits?

[cats]

Suppose you are an EU resident and have BTC from +10 years ago. Value is enough that you could retire but without being on the Swiss private banking league (you would need another 2x or so to have better margin). Coins are obviously of legal origin but you have no KYC buy tickets from regular exchanges. You got paid in BTC back then from participating in forums for instance, most of it would come from here. Some amounts were sent back and forth in now dead exchanges. You can point some of them to the payment addresses used for the payments and transactions but some are missing. The random ancient altcoin mining is also there but amounts are irrelevant. The source of funds is incomplete.

In this situation, what I've heard is that you should get your wallet audited. That is, you should run it through one of those firms that scan your addresses (obviously, you send the public addresses, not the wallet file) and if all is good then you present this to a bank of choice, which ideally you want a solid private bank, but if you are not rich enough you will need to find some EMI. You also want a country that will accept your source of funds.

My question is, has anyone done this process of audits in this context? How did it go?

Also, is there a way to know in advance, what countries and banks would be ok with it? I mean imagine you do this whole process, then show up in country X, and after spending half a year there to gain tax residence, the funds get rejected by either the bank or the taxman.

While getting your coins KYC'd isn't great, since it's really a lottery as you have no control of who owned the coins that you got sent and thus those address scanners could pick some blacklisted stuff, what else are you supposed to do? It's just useless 0's and 1's if you cannot use them, and at this point imagine you really need to use these funds. So im looking for solutions. Of course, if having blacklisted stuff could put you in trouble, perhaps it would be better to just forget about this money, but im assuming there is always a reasonable solution. Most people want to pay taxes, but not end up in trouble by being pioneers of this technology and having coins that come from third parties and not Coinbase. And so you never know if in previous hops before you got these coins, someone used some to by weed on some website on something, and then you get audited and have some of these coins, even if a small amount, and it shows up on the audit. What then? From what I've heard, this is not a big problem, but you never know. It doesn't really sound great, but I want to do everything legally and this seems like the way to do it, but I want some guarantees first.

If anyone has experience, ideally being an EU resident and staying within EU zone, then please let me know, as well as anything else I should need to know. I would only move outside of EU if the money justified that, a 4x from here or so, which I don't expect in years. And even then, im not sure I would be happy in some dodgy place that's too foreign.

 

[uplana]

It’s not that difficult, 10 Bitcoins at the current price give you around $1M USD.

You can indeed have a firm specialized in such matters audit them. We've had similar threads on the forum before with great answers.

What do you plan to do with those Bitcoins now? Exchange them for FIAT just to reinvest in paper assets?

 

[daniels27]

Does your country require any sort of reporting of either the transactions or the holdings? Is there any tax due on either mining or trading in your country?

How quick do you need to off-ramp what amounts? IMO 1M per year is normally no problem without any documentation if done properly. I know people who did even much more without banks having issues. And for nomads, governments aren't that interested neither.

 

[Meta]

Also, is there a way to know in advance, what countries and banks would be ok with it? I mean imagine you do this whole process, then show up in country X, and after spending half a year there to gain tax residence, the funds get rejected by either the bank or the taxman.

Some "audit providers" would have partnership with a specific bank. Meaning that bank certainly accepts their audits. Use those if possible, otherwise it's literally what you said: you go through the process, spend time, funds may get rejected. Don't expect a random non-crypto friendly EMI to bother understanding your crypto lawyer reports.
Regarding other questions, there are a lot (not one or two, a lot!) of similar topics in the forum. You may want to find and read them. Good luck.

 

[Martin Everson]

In this situation, what I've heard is that you should get your wallet audited. That is, you should run it through one of those firms that scan your addresses (obviously, you send the public addresses, not the wallet file) and if all is good then you present this to a bank of choice, which ideally you want a solid private bank, but if you are not rich enough you will need to find some EMI. You also want a country that will accept your source of funds.

I wouldn't do it as what happens if the coins are found to have passed through Al Qaeda funders, stolen, scammed etc. There is often an obligation to report suspected terrorist activity etc. Depending how deep the analysis they could find tainted coins. Also it may not help with a bank that has a strict no crypto funds policy even if you present an audit report. I am not saying it is useless but unless you are sure the auditor is not gonna screw you over if in the unlikely event something serious is found then think hard if you want to go down that path.

Also, is there a way to know in advance, what countries and banks would be ok with it? I mean imagine you do this whole process, then show up in country X, and after spending half a year there to gain tax residence, the funds get rejected by either the bank or the taxman.

You just need to ask the bank in advance. If all goes well then transfer only a portion to the bank to test the water and then the remainder later if all seems ok.

 

[JackAlabama]

Suppose you are an EU resident and have BTC from +10 years ago. Value is enough that you could retire but without being on the Swiss private banking league (you would need another 2x or so to have better margin). Coins are obviously of legal origin but you have no KYC buy tickets from regular exchanges. You got paid in BTC back then from participating in forums for instance, most of it would come from here. Some amounts were sent back and forth in now dead exchanges. You can point some of them to the payment addresses used for the payments and transactions but some are missing. The random ancient altcoin mining is also there but amounts are irrelevant. The source of funds is incomplete.

In this situation, what I've heard is that you should get your wallet audited. That is, you should run it through one of those firms that scan your addresses (obviously, you send the public addresses, not the wallet file) and if all is good then you present this to a bank of choice, which ideally you want a solid private bank, but if you are not rich enough you will need to find some EMI. You also want a country that will accept your source of funds.

My question is, has anyone done this process of audits in this context? How did it go?

Also, is there a way to know in advance, what countries and banks would be ok with it? I mean imagine you do this whole process, then show up in country X, and after spending half a year there to gain tax residence, the funds get rejected by either the bank or the taxman.

While getting your coins KYC'd isn't great, since it's really a lottery as you have no control of who owned the coins that you got sent and thus those address scanners could pick some blacklisted stuff, what else are you supposed to do? It's just useless 0's and 1's if you cannot use them, and at this point imagine you really need to use these funds. So im looking for solutions. Of course, if having blacklisted stuff could put you in trouble, perhaps it would be better to just forget about this money, but im assuming there is always a reasonable solution. Most people want to pay taxes, but not end up in trouble by being pioneers of this technology and having coins that come from third parties and not Coinbase. And so you never know if in previous hops before you got these coins, someone used some to by weed on some website on something, and then you get audited and have some of these coins, even if a small amount, and it shows up on the audit. What then? From what I've heard, this is not a big problem, but you never know. It doesn't really sound great, but I want to do everything legally and this seems like the way to do it, but I want some guarantees first.

If anyone has experience, ideally being an EU resident and staying within EU zone, then please let me know, as well as anything else I should need to know. I would only move outside of EU if the money justified that, a 4x from here or so, which I don't expect in years. And even then, im not sure I would be happy in some dodgy place that's too foreign.

theres no reason to get back into the banking system. If all clear just convert daily living expenses and be happily retired.
banking adds a lot of stress these days as they are like a gestapo force breathing down your neck.

 

[cats]

theres no reason to get back into the banking system. If all clear just convert daily living expenses and be happily retired.
banking adds a lot of stress these days as they are like a gestapo force breathing down your neck.

What do you mean? You cannot pay for anything with BTC, at least anything relevant. And even if you could, since you don't know the source of your funds, and the person or service you pays to will probably end up sending it in an exchange, you could be in trouble. This is the problem with BTC, you do nothing wrong, but anyone can send you coins, and in the small chance they are tainted and show up in some analysis software when you deposit them in an exchange or the person you send them to sends it on an exchange, now suddenly you are liable of holding these coins and you have a problem. This situation incentives people to not get their funds taxed, since who wants to play this gamble?

Even if you convert small amounts for fiat, you are doing so in an exchange that runs every single satoshi through analysis software, so every transaction is a lottery. And so you send this small amount and some day turns out it was tainted, and now they ask you about it and will ask where is this coming from. Why do you have this money if it was never reported. Also EU hates crypto by default, so it's not a great position to be in. You either fully disclose funds or stay off the grid, but then again, there is no use staying out the grid as it stands. If governments gave a solution to people in this situation, a lot of people would simply pay taxes and be done with it, but what options do they give them?

I wouldn't do it as what happens if the coins are found to have passed through Al Qaeda funders, stolen, scammed etc. There is often an obligation to report suspected terrorist activity etc. Depending how deep the analysis they could find tainted coins. Also it may not help with a bank that has a strict no crypto funds policy even if you present an audit report. I am not saying it is useless but unless you are sure the auditor is not gonna screw you over if in the unlikely event something serious is found then think hard if you want to go down that path.



You just need to ask the bank in advance. If all goes well then transfer only a portion to the bank to test the water and then the remainder later if all seems ok.

Yeah, this was my point. And so you ask yourself, what's the point, what would you do? Just forget about this money? It's not fair, but what can you do?

 

[cckuhqilfownnfctux]

What do you mean? You cannot pay for anything with BTC, at least anything relevant. And even if you could, since you don't know the source of your funds, and the person or service you pays to will probably end up sending it in an exchange, you could be in trouble. This is the problem with BTC, you do nothing wrong, but anyone can send you coins, and in the small chance they are tainted and show up in some analysis software when you deposit them in an exchange or the person you send them to sends it on an exchange, now suddenly you are liable of holding these coins and you have a problem. This situation incentives people to not get their funds taxed, since who wants to play this gamble?

Even if you convert small amounts for fiat, you are doing so in an exchange that runs every single satoshi through analysis software, so every transaction is a lottery. And so you send this small amount and some day turns out it was tainted, and now they ask you about it and will ask where is this coming from. Why do you have this money if it was never reported. Also EU hates crypto by default, so it's not a great position to be in. You either fully disclose funds or stay off the grid, but then again, there is no use staying out the grid as it stands. If governments gave a solution to people in this situation, a lot of people would simply pay taxes and be done with it, but what options do they give them?


Yeah, this was my point. And so you ask yourself, what's the point, what would you do? Just forget about this money? It's not fair, but what can you do?

first of all you should verify that your money is indeed clean, there are a few providers of said software, one of them is chainalysis.com
they provide a full report in percentages - how many %s of your coins came from Al Qaeda, how many % came from darknet marketplaces and so on. however they work only with large exchanges and governments but if you have a huge amount of crypto they might do an exception for you and provide an analysis of your coins.
also there are proxy services who use Chainalysis API and work with small exchanges and physical entities, one of them is amlbot.com
while they do not provide a full report divided by percentages they will show a summary how many %s total are dirty and how many are clean. and for example if your coins are 100% clean you could upload them to any exchange without problems, be it a P2P exchange or official and regulated.

You cannot pay for anything with BTC, at least anything relevant.

you've mentioned an EU residency which means you could get some of the "crypto credit cards" which convert crypto to USD/EUR automatically when you buy something, and use these cards to pay for daily expenses. if you are also lucky enough to posess an EU passport then you could also register on any European regulated exchange and get their crypto card.

also you could try crypto cards issued by Hong Kong financial institutions, they have huge limits compared to European cards.

 

[cats]

first of all you should verify that your money is indeed clean, there are a few providers of said software, one of them is chainalysis.com
they provide a full report in percentages - how many %s of your coins came from Al Qaeda, how many % came from darknet marketplaces and so on. however they work only with large exchanges and governments but if you have a huge amount of crypto they might do an exception for you and provide an analysis of your coins.
also there are proxy services who use Chainalysis API and work with small exchanges and physical entities, one of them is amlbot.com
while they do not provide a full report divided by percentages they will show a summary how many %s total are dirty and how many are clean. and for example if your coins are 100% clean you could upload them to any exchange without problems, be it a P2P exchange or official and regulated.

Yeah, I guess there are different ways to obtain these audits directly or through a third party, my question is, what happens to you, the owner of the coins, if you happen to be holding tainted coins? Imagine someone gave you a payment years ago, which wasn't worth much, but it did a 100x, so now you own these amounts of tainted coins, and so they have this audit and your dox next to these tainted coins and you have a problem. This is the whole point isn't it. It's ridiculous how you do nothing wrong, but anyone can send you tainted coins and suddenly you've got this problem and who knows how that ends. Even someone that has a public address posted somewhere to receive donations, if you want to screw them up, send them tainted coins and suddenly they got a problem. This is insane but it is how it works. So if you want to get your coins audited, one should need some guarantees that nothing will happen to the person requesting the audit, otherwise what's the point of gambling it.

you've mentioned an EU residency which means you could get some of the "crypto credit cards" which convert crypto to USD/EUR automatically when you buy something, and use these cards to pay for daily expenses. if you are also lucky enough to posess an EU passport then you could also register on any European regulated exchange and get their crypto card.

also you could try crypto cards issued by Hong Kong financial institutions, they have huge limits compared to European cards.

Well that would require that your coins already passed an audit isn't it. Those credit cards are attached to exchanges, and exchanges send information to the taxman, so you want to have things in order when you pay with your funds. The main key here is sorting this out before you do anything. Moving coins around, paying for things etc, would only complicate things further.

 

[cckuhqilfownnfctux]

Yeah, I guess there are different ways to obtain these audits directly or through a third party, my question is, what happens to you, the owner of the coins, if you happen to be holding tainted coins? Imagine someone gave you a payment years ago, which wasn't worth much, but it did a 100x, so now you own these amounts of tainted coins, and so they have this audit and your dox next to these tainted coins and you have a problem. This is the whole point isn't it. It's ridiculous how you do nothing wrong, but anyone can send you tainted coins and suddenly you've got this problem and who knows how that ends. Even someone that has a public address posted somewhere to receive donations, if you want to screw them up, send them tainted coins and suddenly they got a problem. This is insane but it is how it works. So if you want to get your coins audited, one should need some guarantees that nothing will happen to the person requesting the audit, otherwise what's the point of gambling it.

you could use a Chainalysis proxy/agent service like amlbot.com first to check if your coins are 100% clean and if they are then you could dox yourself by ordering an audit from a different sevice.
the proxy/agent service does not want your passport and will know only your email and IP address, you could use a throwaway email and VPN for privacy.
if your coins are dirty then you will have to clean them, or to be more precise - exchange your dirty coins with clean ones for a fee.
there are different laundry services, ones just run the coins through a mixer which is an absolute bulls**t, others send you "clean" coins from a regulated exchange which is imo a bulls**t too, and the best ones send you freshly generated coins from the mining pools.

 

[cats]

you could use a Chainalysis proxy/agent service like amlbot.com first to check if your coins are 100% clean and if they are then you could dox yourself by ordering an audit from a different sevice.
the proxy/agent service does not want your passport and will know only your email and IP address, you could use a throwaway email and VPN for privacy.
if your coins are dirty then you will have to clean them, or to be more precise - exchange your dirty coins with clean ones for a fee.
there are different laundry services, ones just run the coins through a mixer which is an absolute bulls**t, others send you "clean" coins from a regulated exchange which is imo a bulls**t too, and the best ones send you freshly generated coins from the mining pools.

What software does amlbot use? is it exactly chainalysis?
There's a section called "Analysis" on their website and they have different categories. Red, yellow and green.
So as it stands, looks like your entire wallet may be yellow by default. Unless you have basically withdrawed them from Coinbase, you are not getting green grades. Unless im understanding this wrong, it appears that all transactions by default are at least yellow to them, since they are not identified. The only green ones would be from trusted sources. So would yellow addresses be good to go? Otherwise what's the point. I haven't tried but the way I see it is that everything will be at least yellow, and hopefully no random al-qaeda coins

And it could also happen that you get a certain result on amlbot, but then when you want to cashout, you use another analysis service for the audit because the regulators/banking on the jurisdiction you want to do it requires a certain analysis software, and it gives you a different result that you weren't expecting.

 

[cckuhqilfownnfctux]

What software does amlbot use? is it exactly chainalysis?

I do not know for sure but few years ago it definitely was Chainalysis.

So would yellow addresses be good to go?

most of the times yes if that's 100% "unknown source".
if even 1% of the coins come from the known dirty sources - terrorists, darknet marketplaces, sanctions, ransomware, etc - then you could have problems. however if the coins have even 1% of dirt they might mark the wallet as red, I am not sure how amlbot.com work now because they've stopped showing percentages just few months ago, possibly Chainalysis limited the amount of information provided to their proxies/agents, or Amlbot have changed their blockchain analysis provider.

And it could also happen that you get a certain result on amlbot, but then when you want to cashout, you use another analysis service for the audit because the regulators/banking on the jurisdiction you want to do it requires a certain analysis software, and it gives you a different result that you weren't expecting.

yes, this is correct.
you can't be sure that you are never questioned about your coins, however if even amlbot shows that your coins are dirty then it's very high probability you will be asked about where did you get them.

and don't rush with cleaning/mixing your coins until you're 100% sure they are dirty, because with a high probability you might get even dirtier money from the cleaning service, and with much higher probability you will be asked about these coins, because a "yellow" address which had no any transactions for 10 years and you have no SoF for has more credibility than a "green address" that has hundreds of recent transactions for which you have no SoF for.

 

[cats]

I do not know for sure but few years ago it definitely was Chainalysis.

most of the times yes if that's 100% "unknown source".
if even 1% of the coins come from the known dirty sources - terrorists, darknet marketplaces, sanctions, ransomware, etc - then you could have problems. however if the coins have even 1% of dirt they might mark the wallet as red, I am not sure how amlbot.com work now because they've stopped showing percentages just few months ago, possibly Chainalysis limited the amount of information provided to their proxies/agents, or Amlbot have changed their blockchain analysis provider.

yes, this is correct.
you can't be sure that you are never questioned about your coins, however if even amlbot shows that your coins are dirty then it's very high probability you will be asked about where did you get them.

and don't rush with cleaning/mixing your coins until you're 100% sure they are dirty, because with a high probability you might get even dirtier money from the cleaning service, and with much higher probability you will be asked about these coins, because a "yellow" address which had no any transactions for 10 years and you have no SoF for has more credibility than a "green address" that has hundreds of recent transactions for which you have no SoF for.

What is the use of amlbot nowadays if they have nerfed it? Also is this a free to use service or you have to pay? If you have to dox yourself to pay it basically removes the purpose of getting an initial screening and once the coins are safe then you get a doxed audit in order to do banking, but not before since you would be gambling as you don't know what the SoF of your coins is until you audit them.

 

[AndyAresa]

It might be a bit off topic, but I will throw in my question. If I buy BTC from a CEX like Kraken or Bybit, am I right assuming that the BTC I purchased is not tainted? I mean not p2p section, not spot trading, but directly from the CEX? For example, Bybit offers one-click buy of BTC for fiat previously deposited.

 

[daniels27]

It might be a bit off topic, but I will throw in my question. If I buy BTC from a CEX like Kraken or Bybit, am I right assuming that the BTC I purchased is not tainted? I mean not p2p section, not spot trading, but directly from the CEX? For example, Bybit offers one-click buy of BTC for fiat previously deposited.

You never know what money has been used for in the past. You pay an apple with $100 and get some $10 bills back. They may have been used in a crime before. Sand with coins. But if you have proof that you bought them from a bona fide place, you should be fine.

The problem is just that anybody can accuse you of anything and you may have tons of hassle to clean the situation and your name later on.

 

[cats]

You never know what money has been used for in the past. You pay an apple with $100 and get some $10 bills back. They may have been used in a crime before. Sand with coins. But if you have proof that you bought them from a bona fide place, you should be fine.

The problem is just that anybody can accuse you of anything and you may have tons of hassle to clean the situation and your name later on.

Yeah so what are you supposed to do? All you have is presenting an audit and hoping they don't screw you up for trying to come upfront, keyword hope, because that sounds like a gamble to me. So what in the world do they want?

 

[daniels27]

Yeah so what are you supposed to do? All you have is presenting an audit and hoping they don't screw you up for trying to come upfront, keyword hope, because that sounds like a gamble to me. So what in the world do they want?

Have proper documentation ready. If you buy then on binance, there is no risk with an account statement.

 

[cats]

Have proper documentation ready. If you buy then on binance, there is no risk with an account statement.

The problem is predicting what they would consider as proper documentation given the fact that you didn't buy them on binance or on any usual exchanges.

 

[daniels27]

The problem is predicting what they would consider as proper documentation given the fact that you didn't buy them on binance or on any usual exchanges.

The question I responded to was this one:

A

Post in thread 'Anyone has experience with audits?'

Saturday at 07:56

It might be a bit off topic, but I will throw in my question. If I buy BTC from a CEX like Kraken or Bybit, am I right assuming that the BTC I purchased is not tainted? I mean not p2p section, not spot trading, but directly from the CEX? For example, Bybit offers one-click buy of BTC for fiat previously deposited.

• AndyAresa

• 

I consider Kraken and Bybit as usual exchange.

If you buy the coins elsewhere and they are dirty, you may risk being accused of money laundering. You can prevent this by not dealing with dubious people and checking where they have the coins from.

 

[wonderfulboy]

It might be a bit off topic, but I will throw in my question. If I buy BTC from a CEX like Kraken or Bybit, am I right assuming that the BTC I purchased is not tainted? I mean not p2p section, not spot trading, but directly from the CEX? For example, Bybit offers one-click buy of BTC for fiat previously deposited.

I never found and troubles buying from Kraken, if someone ask I use the account statement from them for proof and all questions are gone.